HMDA Triggers 26 Credit Union Fair Lending Exams

Twenty-six credit unions were subjected to fair lending compliance examinations in 2013, according to the NCUA's 2013 Annual Report, released Monday. In total, the NCUA's Division of Consumer Compliance Policy and Outreach spent 5,334 hours examining the credit unions, at an average of 205 hours per credit union.

Additionally, the NCUA initiated 41 off-site fair lending contacts, for a total of 902 hours.

In a March 2013 letter to credit unions, NCUA Chairman Debbie Matz said credit unions selected for fair lending exams and offsite supervisory contacts would demonstrate the potential for higher fair lending risk. Credit unions were selected for exams due to qualities that included lending practices that fall outside normal terms for pricing, denial, withdrawal or lending terms according to the credit union’s required Home Mortgage Disclosure Act report.

The agency will also look for fair lending violations, general compliance risks and other factors, such the potential for higher fair lending risk due to mortgage volume, loan types or complexity.

Federal credit unions that demonstrated the potential for higher fair lending risk, but were not HMDA outliers, received offsite fair lending supervision contacts.

“If an offsite supervision contact indicates the possibility of discriminatory practices or significant findings of non-compliance with fair lending laws or regulations, a federal credit union will be considered for a fair lending exam during the next exam cycle,” Matz said in 2013.